Despite questions over ANCs, many pay out millions in dividends, scholarships

September 30, 2010

Now, dozens of Alaska native corporations, benefiting from extraordinary rules that allow them to receive contracts of any size from the federal government without competition, collectively channel millions each back into the communities each year.

The program has been plagued by a lack of government oversight, allowing established businesses to use the native corporations in some cases as fronts to get business without competition, an examination by The Washington Post found. Millions have gone to nonnative executives and companies.

But even as questions about the program mounted over the years, a number of ANCs increased payments to shareholders and other benefits.

The 12 main regional Alaska native corporations paid $171 million in dividends to about 100,000 shareholders in 2008, according to a recent report by the ANCSA (Alaska Native Claims Settlement Act) Regional Association. A congressional study of 19 corporations last year estimated that about 44 percent of their revenue came from federal contracting.

Some also have created jobs at federal contracting operations for their shareholders. Sealaska chief executive Chris McNeil said that his corporation's commitment to that goal means that 21 percent of employees of Sealaska subsidiaries in the SBA 8(a) program are Alaska natives. Some are executives.

"It's a motivation for us to see if we could be sure our people would have the opportunities for these kinds of professional positions," he said.

The benefits vary substantially among the corporations. Many offer scholarships and cultural initiatives via foundations and other nonprofit organizations. In 2008, they paid out $35 million in scholarships and charitable donations, according to the ANCSA report.

The NANA Regional Corp., which has 12,000 shareholders from several tribes, two years ago created an economic development committee that offers $55,000 grants for villages. The corporation spends $200,000 each year on Camp Sivunniigvik, where every summer native elders teach children traditional "subsistence lifestyle" skills such as hunting and gathering. The corporation has spent hundreds of thousands more in recent years on boys and girls clubs, sports tournaments and tribal governments.

Chugach Alaska Corp., which has about 2,200 Eskimo, Aleut and other native shareholders, runs shareholder development programs to draw young people into jobs in Alaska. It also runs a summer "spirit camp" for young people. Recently, Chugach joined Chenega Corp. and Tatitlek Corp. in financing the rebuilding of the historic St. Michael the Archangel Orthodox Church in Cordova.

The Eyak Corp., a village ANC owned by about 428 native shareholders, has used tens of thousands of dollars in revenue from federal contracting to pay for 126 higher education scholarships, including 23 this year. Officials there said in a news release that they have spent $29 million on dividends and other benefits over the years.

Doyon Limited, the largest land owner in Alaska with more than 12 million acres in the heart of the state, has 18,000 shareholders. Its foundation awards education scholarships of up to $7,000 to ambitious students. Last year, the foundation provided almost $600,000 in scholarships to 406 recipients. The corporation also has a "potlatch fund" that helps shareholders facing funeral expenses, and it supports a state nonprofit agency that provides social events for thousands of elders.